As a high-tech gateway, South Florida profits

NAP could spur an economic boom

Sunday, August 13, 2000
By Beatrice E. Garcia, Miami Herald

In the Internet world, the thinking goes: If you build it, they will come.

If there are high-speed fiber-optic networks and the ability to exchange Internet traffic with a variety of carriers, the users will come.

A nondescript four-block section in Fort Lauderdale's downtown, just north of Broward Boulevard, is a good example.

BellSouth's central office is based there, along with the switches and equipment for three competitors: Intermedia Communications, Worldcom and MPower Communications. The building BellSouth recently vacated when it built a new facility for its central office is being retrofitted to house telecommunications companies.

Outside their front doors, these companies have access to fiber-optic cable powered by Intermedia Communications, Hyperion, Worldcom, FPL Fibernet and Espire Communications.

MPower, a firm that offers high-speed Internet access to small- and medium-sized businesses, has experienced rocketing growth since it entered the South Florida market in late 1998. Its staff has grown from three to more than 130 in less than two years.

The strong economic growth that cluster of technology and telecom businesses in downtown Fort Lauderdale is experiencing is what many local officials are hoping for as these industries expand here.

The building of a major network access point, or a NAP, envisioned and proposed by both BellSouth and a consortium of more than 40 telecom companies, is expected to have a major economic impact throughout this region.

AN INTERNET GATEWAY

Having a NAP in South Florida, supported by miles and miles of fiber-optic cable, means that this region is no longer the end of the line. It can truly call itself the Internet gateway to Latin America, the Caribbean, Europe and Africa.

``South Florida will be viewed as a true technology hub,'' says Michael Corbit, manager of channel programs at Citrix Systems in Fort Lauderdale.

Why is having a NAP such a big deal for South Florida? Does it matter whether it's a series of nodes strategically located in the three counties as BellSouth plans or a central facility in downtown Miami as the consortium of 43 companies plans?

The Internet allows businesses and information to go anywhere. Employees and Internet surfers can access the Net from a laptop, PC, cellphone, or wireless hand-held device, such as a Palm. Theoretically, where a user is physically located doesn't matter. With a modem and Internet access, you're set wherever you are.

But in practice, location does matter.

The Internet really isn't one giant network. It's a series of networks that connect at various points throughout the world. The more quickly and easily information -- be it data, video or audio -- is exchanged between networks, the more efficient and inexpensive the entire process becomes.

ROUNDABOUT PATH 

If a Kendall resident using BellSouth.net sends an e-mail to a pal in Plantation who uses America Online, the e-mail travels via BellSouth's network locally, then switches over to UUNet for the trip to Washington, D.C. There, it's handed back to AOL and then travels back south to Plantation.

With a NAP in South Florida, BellSouth and AOL would exchange that e-mail right here. The transfer of information is faster, more efficient and cheaper for all involved.

For a company such as MPower, which provides high-speed Internet access to small and medium-size businesses, having several fiber-optic networks at its doorstep means fast, easy access to bandwidth that's competitively priced.

Al Rozio, MPower's operations director in Fort Lauderdale, explains that with more bandwidth available, the company can offer customers more applications and services. For instance, the ability to process payroll online requires a far faster connection than a dial-up modem can deliver.

Benjamin Finzi, executive vice president with EPIK Communications, which has been spearheading the NAP of Americas effort, says a NAP will initially attract more telecom, Web-hosting and design companies, as well as advertising, marketing, legal and employment services. ``You'll see all the ancillary services needed to support the digital economy.''

Corbit predicts that every industry will be affected. Not only will real estate, construction, finance, hospitality and government have to deal with the growth of the technology sector, their operations will also be enhanced by technology.

Alex Muse, chief executive of LayerOne, which builds mini-NAPs that provide carriers with the ability to connect with several fiber-optic networks and exchange Internet traffic, opened one of its first facilities in downtown Miami, a few blocks away from where the NAP of the Americas will be based. The building is 80 percent full. One tenant, Stonehenge Telecom, an Orlando company that provides Internet telephony, set up its Latin operations hub in the LayerOne facility.

The prospect of booming demand for Internet connections and services in Latin America and Miami's proximity to that market were factors that ranked high when LayerOne was making its decision, says Muse.

BETTER SERVICE

Bob Plessett, who runs TeleSwitch in West Dade, knows that having more bandwidth and faster connections means he can offer his clients better service. One of TeleSwitch's specialties is outfitting call centers, especially when they outgrow one location and set up a remote office with more representatives. Access to voice and data systems all go over the Internet, needing big pipes and good connections.

``Having fast access of us is huge,'' says Plessett.

The possibilities for more businesses and the accompanying economic development aren't wasted on state and local officials. They're ready to shower the projects with various incentives.

Earlier this year, the Florida Legislature passed a bill granting the NAP of the America's developers a $600,000 sales tax break on equipment used to build and outfit a NAP. The bill was sponsored by Sen. Ron Klein, who represents Deerfield Beach and south Palm Beach County, and Rep. Luis Rojas of Hialeah. 

BellSouth plans to apply for the tax break, believing that some of the switching equipment it needs to buy to outfit
its four nodes for its ``virtual NAP'' would qualify for the credit.

Frank Nero, president of the Beacon Council, Miami-Dade's economic development agency, says that since the NAP of the Americas is located in empowerment and enterprise zones as well as a redevelopment district, the project may quality for other incentives as well, such as for job creation. 

INCENTIVES OFFERED

Miami's Community Redevelopment Authority has promised the Terremark-Heat partnership, which is developing the Technology Center of the Americas where the NAP will be housed, a hefty $750,000.

Arthur Teele, Miami city commissioner and CRA chairman, says the money would be used to reimburse the developer for fees it will have to pay the city.

But Teele prefers to use the money to provide some of the infrastructure the Technology Center might need, such as sidewalks, street lighting, and water and sewer hook-ups.

In the Internet world, speed is everything -- including for getting a NAP up and running.

The city of Miami promised Terremark and the Heat organization that it would fast-track permits and necessary approvals to begin the building as quickly as possible. So far, city officials are living up to their word.

Terremark has all the permits it needs and it already started doing initial work at the site. The company has broken ground on the Technology Center, where the NAP and Global Crossing's GlobalCenter will be located.

The importance of pushing forward on this project is a big motivator.

``Miami is in such a super position to launch itself as the Internet gateway to Latin America,'' says Diane Sanchez, Global Crossing's president for Mexico, Central America and the Caribbean.